Saturday, January 2, 2010

18PC INCREASE IN GAS TARIFFS ACROSS-THE-BOARD IS A DEATHBLOW: KCCI

“18 per cent increase in Gas Tariffs by OGRA is one-sided decision and a deathblow to industrial, commercial and CNG Sector”, expressed by President, Karachi Chamber of Commerce & Industry, Abdul Majid Haji Muhammad, in a press statement, while expressing his deep concern against the decision of OGRA for allowing Gas Companies to increase gas tariffs across-the-board by 18 percent.

Abdul Majid strongly condemned and criticized the apathetic and slapdash attitude of the concerned quarters. He lamented that in the prevailing conditions, further increase in gas tariffs will worsen the situation, owing to further increase in CNG prices and ultimately commuters will be penalized and cost of transportation will high-rise.

Abdul Majid recalled that during the hearing of SSGC in OGRA, KCCI, raised high-voice against the unjustified increase of tariffs allowed by OGRA to gas companies from time to time, while considering the case one-sided and not bearing in mind the point of views of other parties viz. industrial, commercial and domestic consumers.

Abdul Majid lamented that such actions will protect the vested interests of gas companies and their revenue generation will yield whereas the industry and commercial concerns are fatally stabbed with another deathblow which will increase the cost of production and doing business and will further narrow down their profitability.

Abdul Majid was of the view that such harsh decision without consultation and consent of stakeholder may result in widespread discontentment in the business community. The closure of industry, due to detrimental affect of high cost of production due to higher utility tariffs will lead to flight of capital, massive unemployment and decline in the revenue of government, he focused.

Abdul Majid maintained that the said increase will pose a killing threat for the industry owing to highest-ever tariffs of utilities in the history of Pakistan. The cost of production/ manufacturing has gone exorbitantly higher absolutely due to unjustified policies of OGRA and NEPRA.

Abdul Majid stated that it is incomprehensible that on one pretext, government contemplates to achieve the targets for nominal growth of 2.5 percent and on the other pretext its inconsiderate and austere decisions to increase utility tariffs have already penalized the industry and posed as terrible threats for achieving the same.

At present, country is going through a worst economic crisis in terms of escalating cost of production/ manufacturing based on continuous rise on the utilities. The dollar has depreciated in the international market, oil prices have stabilized, interest rates and inflation started decreasing. In wake of such indicators, it is unjustified to enhance the tariffs, he maintained.

Abdul Majid demanded that Government must negotiate with foreign companies for favourable conditions; and interests of the business community should at the forefront of OGRA decisions rather than that of foreign companies earning huge profits from Pakistan and sending foreign exchange to their respective countries.